Union Fenosa S.A. (Union Fenosa) has reported core earnings of EUR2.28 billion for the full year 2008, up 10%, compared with the core earnings in the previous year. It also reported EBIT of EUR1.68 billion for the full year 2008, up 14.2%, compared with the EBIT in the previous year.

Gross financial debt at end of December 2008 was up 18.8% at EUR6.89 billion with 80% of borrowing classed as long term, good news for Gas Natural which has taken out an EUR18.5 billion loan to acquire Union Fenosa.

Turning to Gas Natural’s planned EUR3 billion of asset sales to fund the Union Fenosa bid, Fenosa chairman Pedro Lopez Jimenez said he didn’t expect Gas Natural to sell the group’s 18% of Indra.

Indra is the leading IT company on Madrid’s stock exchange… I would find it strange if a stake in Indra was not maintained, the chairman said.

Jimenez said that a more likely asset sale would be of Fenosa’s 5% of rival gas importer Cepsa, on whose board the chairman sits.

Fenosa has agreed to sell the stake in Cepsa jointly with Santander’s (SAN.MC), so a sale will probably come naturally as Santander is interested in selling its Cepsa stake, Jimenez said.

We were on the verge of a sale before, he said.